Illinois Tool Works Inc
NYSE:ITW

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Illinois Tool Works Inc
NYSE:ITW
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Price: 257.6555 USD -0.45%
Market Cap: 76.1B USD
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DCF Value

This DCF valuation model was created by Alpha Spread and was last updated on Dec 23, 2024.

Estimated DCF Value of one ITW stock is 155.086 USD. Compared to the current market price of 257.6555 USD, the stock is Overvalued by 40%.

ITW DCF Value
Base Case
155.086 USD
Overvaluation 40%
DCF Value
Price
Worst Case
Base Case
Best Case
155.086
DCF Value
Worst Case
Base Case
Best Case
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DCF Value: 155.086 USD

Present Value Calculation

This block is the starting point of the DCF valuation process. It calculates the present value of a company's forecasted cash flows based on selected operating model. Adjust key parameters like discount rate and terminal growth, and alter inputs such as revenue growth and margins to see their impact on valuation.

DCF Model
Base Case Scenario

The present value of cash flows over the next 5 years amounts to 14.2B USD. The present value of the terminal value is 31.6B USD. The total present value equals 45.8B USD.
Forecast Period
Years
Discount Rate
%
Show All DCF Settings
Terminal Growth
%
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DCF Value Calculation

This stage translates the present value into DCF value per share. For firm valuation models, it adjusts present value for debt and assets to derive equity value (skipped if using equity valuation model). Finally, this equity value is divided by the number of shares to determine the DCF value per share.

Present Value to DCF Value
Capital Structure

Present Value 45.8B USD
Equity Value 45.8B USD
/ Shares Outstanding 295.3m
ITW DCF Value 155.086 USD
Overvalued by 40%

You are using the equity valuation model. In this approach, further calculations for converting firm value to equity value are not required. The present value, obtained in the present value calculation block, already represents the equity value.

The DCF value per share is derived by dividing the present value by the number of shares:

Present Value
45.8B USD
/
Number of Shares
295.3m
=
DCF Value
155.086 USD

Valuation Analysis

Sensitivity Analysis
DCF Value Sensitivity Analysis

Sensitivity Analysis assesses how changes in key factors like revenue growth, margin, and discount rate affect a stock's DCF value. By visualizing various scenarios, from significant downturns to optimistic growth, this tool helps you understand potential valuation shifts, aiding in risk assessment and strategic decision-making.

DCF Financials
Financials used in DCF Calculation

Revenue
16.5B 19.4B
Net Income
3.5B 3.9B

See Also

Discover More

What is the DCF value of one ITW stock?

Estimated DCF Value of one ITW stock is 155.086 USD. Compared to the current market price of 257.6555 USD, the stock is Overvalued by 40%.

The true DCF Value lies somewhere between the worst-case and best-case scenario values. This is because the future is not predetermined, and the stock's DCF Value is based almost entirely on the future of the company. Knowing the full range of possible stock DCF values gives a complete picture of the investment risks and opportunities.

How was the DCF Value calculated?

1. Present Value Calculation. Utilizing the DCF operating model, Illinois Tool Works Inc's future cash flows are projected and then discounted using a chosen discount rate to determine its Present Value, which is calculated at 45.8B USD.

2. DCF Value Calculation. The company's capital structure is employed to derive the total Equity Value from the previously calculated Present Value of the cash flow. This Equity Value, when divided by the total number of outstanding shares, yields the DCF Value of 155.086 USD per share.

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